Matched Bargain Service - for delisted shares

EdGasket

I have some MAR City shares which are currently delisted from AIM and have been informed that Capita (Beckenham MBS) offer a matched bargain service (MBS) for these and a few other delisted shares whereby they match buyers with sellers but you have to name the price at which you are prepared to sell or buy.

However the snag is that they refuse to tell me any indicative price, whether any bargains have been matched and if so at what price. Therefore i have no idea whether it would be worth paying the fees to get my holdings certificated and then trying to guess a price at which my shares could be sold. I imagine they are worth a few pence only (last quoted price before delisting was 36p) as they can't be traded but really have no idea. What's the point of offering a matched-bargain service and then not publishing a ballpark price? I would imagine everyone wanting to sell delisted shares and hardly anyone buying.

Has anyone ever used such a service with success?

Atreyu107

Unfortunately, you're largely correct in your assumption that MBS's are heavily weighted to the sell side.

Most offer an online platform where you can view the offers and bids. I'm not sure about Crapita, so it's probably worth asking them.

In my experience though (ex-Corporate Actions adviser for a large stockbroker) matches rarely happen, and if they do it's for minuscule prices.

grey_gym_sock

reading a few of the last RNS announcements before the company was delisted raises a lot of red flags for me.

debts owed to the company by the MD and his wife (also a director) were partly to be settled in kind, by handing over incomplete property developments, instead of in cash. and partly to be settled with cash which they raised with a bank loan, secured on their shares in the company. the latter could lead to the bank owning a large block shares in the company which it would be looking to get rid of. and could be read as the directors being keen to sell their shares. it all also raises issues of conflicts of interest.

the delisting was because the company's NOMAD resigned, with no reason given AFAICS (though i didn't look very hard), and no replacement could be found. a bit earlier, a non-executive director resigned.

and of course, there's the fact that they haven't relisted the shares yet. presumably you have received company reports, etc, since the delisting? but unless these are very positive, it's hard to believe that the shares shouldn't now be worth a lot less then they were when last listed. and that is before applying a discount to the price just for the shares being very illiquid when there's only a matched bargains service.

this isn't constructive (except as a warning to others), but: if you aren't prepared to read a company's reports, and take a view on what it's worth from that, why would you even buy a share in an individual company, especially a small company, and especially on AIM (which is rife with outright frauds)?

EdGasket

What's any of the previous post got to do with the question asked about Matched Bargain Service??

Malthusian

It should tell you that you may as well mentally write them off as worthless and hold onto them. If there is any value left in them at all, you will almost certainly realise more by waiting until the administrators have wound up the company and returned any value to shareholders

If there is any chance of any value being realised, any prospective buyer would offer you a tiny fraction of that value because of the very high chance that nothing is left after the administrator has wound the company up, collected their fees and paid the company's debts. The only scenario in which I can imagine someone bothering to sell is if they own a million shares in MAR City and are happy to sell them for a penny each because they owe £10,000 to the Russian !!!!! - i.e. they don't care whether the shareholders might eventually receive 2p in the pound in a year's time because they'll be wearing a concrete overcoat tomorrow.

Asset_Match

Good morning chaps,

I was rather randomly alerted to this thread because I've worked for a number of years in this 'matched bargain' space and currently do so with a firm called Asset Match.

All very valid points I must say.

However this isn't particularly directed at Mar City but is a case in point for many a company delisting from an exchange. The share price tends to come off dramatically when a company announces that they wish to come off market but sadly that's just the nature of the beast. Does that mean that the shares should be worth c.80% less simply because AIM has served it's purpose.....absolutely not. Market makers pull the price, spreads get wider and seemingly everyone wants out simply because most institutions won't hold onto unlisted stock coupled with the fact that investors see the last days of trading as the only opportunity to cash out.

Many companies flourish out of the public spotlight not to mention making a saving of upwards of £150k pa simply to provide shareholders with an element of liquidity; all of which comes along with huge gaping spreads and a market size of a peanut.

Essentially this is why Asset Match exists; to provide liquidity in these types of shares.

Alongside 20 odd private companies (ala BrewDog, Black Sheep Brewery, Transact etc), we manage a trading facility for numerous other firms who like Mar City chose to come off market.

Capita's offering as you quite rightly pointed out EdGasket harks from the dark ages of matched bargains and does no-one any favours. How on earth do you know how these companies are doing when you have no idea of the share price let alone where others are positioning themselves to buy and sell? Madness

On the other hand, you can log into Asset Match and see a live book of bids and offers and in what size. This is auction led so you have a window in which to place your instruction all of which is done via yours or our stock broker. If you're successful then settlement is a nice and easy T+2 so just as is on the major exchanges.

FYI EdGasket we have been in talks with Mar City after being contacted by numerous shareholders, so you never know, they may well be on Asset Match in the not too distant future.

Any who, my apologies for the rather long winded post but I just thought I would shed a bit more light on the murky world of off market trading.

All the best,

Ben Weaver

Malthusian

Ben, you may want to read the forum's rules regarding posting on behalf of an organisation in an official capacity.

On another subject, why on earth is the five-letter word which begins with M and commonly refers to a well-known Sicilian criminal organisation censored as a swearword??

Asset_Match

Why thank you Malthusian for your comments, although the latter is somewhat bizarre it must be said.

Re: the forum's rules I have to hold my hands up here; I didn't read them. However if I have suggested anything untoward I would expect my comments to be pulled by the powers that be which I don't anticipate happening.

Regarding your previous post, it is in fact Mar City Developments Ltd that has gone into administration which is a subsidiary to the parent Mar City Plc, EdGasket was referring to.

EdGasket

Well let me know via this thread if you are trading MAR on Asset match. At the time of suspension they had property assets of around 1.5 to 2 X the share price but I guess a lot of that will be gone now.

How much does Asset match charge for a one-off deal and would I need to be a certificated holder or can you deal with some of the nominee brokers directly?

Asset_Match

Hi EdGasket,
As you're aware, Mar City shares are not currently trading on our platform so my answer is very much theoretical for you at this stage.

However, dealing commissions are a minimum of £20 per trade or 3% of the total consideration (whatever the greater).

We deal with numerous brokers who more often than not can deal on your behalf without the need to open a new account elsewhere i.e Brewin, Cannaccord, Charles Stanley, Redmayne, S&W etc all deal in unlisted stock.

The exception to rule is that if you currently hold your shares with an online broker i.e Halifax, Barclays etc or a handful of firms that do not get involved in private shares i.e Hargreaves Lansdown, WH Ireland, they will not deal for you. In which case case you can either ask for a share cert to be sent to you in order to sell them by completing a simple form or alternatively you can transfer the shares over to a new broker.

Hope that helps.

Ray_Singh-Blue

Very useful post, thanks Asset Match. I hope your posts do not get pulled as I have learned something from them.